Crown Prince Mohammed bin Salman, the architect of the "Vision 2030" programme of reforms for a post-oil era, has announced a host of mega projects, including a futuristic megacity with robots and driverless cars, which require about $500bn in investments.

He said the 2018 budget will have the largest state spending in the kingdom's history, which was evidence of success despite low oil prices. He said improving living standards for Saudi citizens was a government priority, according to comments on the state news agency SPA.

The cornerstone of the reforms is an initial public offering of nearly five percent of national oil giant Aramco planned for next year.

Prince Mohammed has also been behind decisions to allow women to drive and to lift a 35-year-old ban on cinemas.

Last month, the heir to the throne launched a wide-ranging crackdown on dozens of elites, ostensibly to tackle corruption, but experts say it was also a way of consolidating his grip on power.

Since 2015, the ultra-conservative country has introduced a series of price hikes on fuel and electricity.

It has also imposed fees on expats and is preparing to introduce value-added tax in the new year.

The finance ministry said unemployment among Saudis rose to 12.8 percent in June, up slightly from last year.

The government has allocated $13.9bn for a cash transfer programme called the Citizen Account to compensate the needy for hiking prices.